Blockchain Video Startup YouNow Files With SEC to Give Away Tokens

Published on by Coindesk | Published on

The New York-based startup has filed a Reg-A+ offering circular for its Props token with the Securities and Exchange Commission - even though it isn't selling them to investors, accredited or otherwise.

If approved by the regulator, the qualification would clear YouNow to distribute Props to content creators, network transaction validators and others without registering the tokens as securities.

Instead, YouNow will disperse millions of Props, an ERC-20 token that runs on the ethereum blockchain, to users of its app.

Previously, YouNow raised $25 million through the sale of Props, $20 million of that via a simple agreement for future tokens, a legal structure devised at the height of the 2017 initial coin offering boom.

While the 178 million Props allocated for the current "Offering" have a nominal price, the only consideration YouNow asks is participation in its platform.

The Props Tokens cannot be purchased as part of this offering, but can only be earned by apps, users and validators that will contribute to the Props Network.

YouNow, the first app on the network, intends to distribute a significant portion of its own tokens to millions of its users.

Tokens are to be allocated to users based on their current status on YouNow, which signifies the contribution they have made to the network to date.

Upon qualification, YouNow users may earn Props Tokens by, for example, creating content on the app.

Props is backed by Union Square Ventures, Comcast Ventures, and Venrock, among others and is planning on giving away tokens as grants to programmers on the platform and for popular users.